* Investors look ahead to earnings season
* Google rises as China renews license, helping Nasdaq
* Johnson & Johnson shares down on drug recalls
* Stocks up: Dow 0.6 pct, S&P 0.7 pct, Nasdaq 1 pct
* For up-to-the-minute market news see [STXNEWS/US] (Updates to close)
By Angela Moon
NEW YORK, July 9 (Reuters) - Wall Street closed out its best week in a year on Friday, snapping back from a long stretch of selling, as investors looked ahead to the start of the earnings season.
Stocks ended near the day’s highs, but trading was thin. Just 6.197 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, making it the lowest-volume day of the year.
Google Inc GOOG.O helped lift the Nasdaq, rising 2.4 percent to $467.46 after Beijing gave the company the green light to continue operating its China Internet search page. U.S.-listed shares of rival Baidu Inc BIDU.O fell 1.7 percent to $71.20. For details, see [ID:nSGE6680F9]
The major stock indexes advanced 5 percent in the holiday-shortened week, as investors put a string of dismal data behind them to focus on what is expected to be another solid quarter for corporate results.
However, the low volume and volatility suggested investors still harbor doubts about the economy and whether the disappointing data signal a double-dip recession.
“Investors are reassessing these concerns now as they expect a positive earnings season,” said Stephen Massocca, managing director at Wedbush Morgan in San Francisco.
“But we are likely to see more volatility next week. Although the numbers that the companies report may be good, the guidance that they give may not be.”
The Dow Jones industrial average .DJI was up 59.04 points, or 0.58 percent, at 10,198.03. The Standard & Poor's 500 Index .SPX was up 7.70 points, or 0.72 percent, at 1,077.95. The Nasdaq Composite Index .IXIC was up 21.05 points, or 0.97 percent, at 2,196.45.
The earnings season unofficially begins with Alcoa Inc AA.N after the closing bell on Monday. Analysts are expecting overall second-quarter earnings to grow by 27 percent, according to Thomson Reuters data. This is up from the 22.4 percent that analysts were anticipating at the beginning of the year. [ID:nN08195712]
Alcoa, the first Dow component to report, is expected to swing to a second-quarter profit, though falling aluminum prices have prompted analysts to cut their estimates on the stock. [ID:nN09269488]
The S&P 500 rose for a fourth straight day, up 5.4 percent this week, its best week since mid-July 2009. But the index is still down about 11.7 percent from its most recent closing high in late April.
The Dow rose 5.3 percent and the Nasdaq advanced 5 percent this week.
Johnson & Johnson JNJ.N was the biggest drag on the Dow, falling 1.4 percent to $60.54 a day after it recalled more Tylenol and other over-the-counter drugs following consumer complaints of odors. The move expands a recall started in January. [ID:nN08230084]
In deal news, Air Products and Chemicals Inc APD.N late Thursday raised its hostile bid for rival Airgas Inc ARG.N by 5.8 percent to $5.3 billion, but the offer remained slightly below the company's current market value. [ID:nN08231796]
Air Products rose 1.4 percent to $69.74, while Airgas rose 1.6 percent to $64.90.
In economic news, U.S. wholesale sales fell unexpectedly in May, lifting inventories to their highest level in 11 months, a government report showed. Analysts said a slackening in demand could lead businesses to try to curb the inventory buildup, weighing on economic growth. [ID:nN09265120]
Recent U.S. data showing slowing growth in the services and manufacturing sector, weakness in housing and a stagnating jobs market also worried investors, although most say it is too early to call a double-dip recession.
The day’s trading volume fell well below last year’s estimated daily average of 9.65 billion. Advancing stocks outnumbered declining ones on the NYSE by 2383 to 627 while on the Nasdaq, advancers beat decliners by 1979 to 642. (Reporting by Angela Moon, Editing by Kenneth Barry)